6 Reasons China Won't Destroy the World

This article was originally pitched
to Cracked.com. It was on its way to publication when I accidentally
insulted the senior editor, who booted the pitch in retaliation.
Needless to say, I was mad. But, there's no point in letting a
good idea like this go to waste. I'm republishing it because the
article was already in decent shape. As a side note, I didn't spend
two weeks of intensive editing on this article like I did for my last
one for Cracked... but whatever. It's still pretty interesting. At
least I think so.

______________________________

6
Reasons China Won't Destroy the World

These days it seems like you can't
go ten minutes of watching the news without hearing about how awesome
the Chinese are and how their economy is growing to approximately the
size of Godzilla. Shockingly, people are freaking out about China's
newfound power. However, what they tend to forget is that the global
economy is not simple and that if anything, China is in some pretty
deep sh*t. They too exist in the real world, and reality always comes
with problems. The media never likes to talk about things
like...

#1- Their tsunami wave of old people

The
Myth:

"Oh my god! China has so many people and they all
want to work hard! They're INVINCIBLE!!!"

The
Reality:

China has a lot of people. When your population is
over a billion strong, that means you have plenty of people to work
the factories making DVD players and toxic kids' toys. However, all
of those people will get old and retire one day. Other then raising
an army of Wal-Mart greeters, what do you do with them? China clearly
has no idea, because they lack
any kind of Social Security or retirement system. And of course,
that's the one thing they really, really need because a third of all
Chinese people will be over sixty by 2050. In the United States, it's
17.4%.
Plus, with the one child per family policy, that means the next
generation of Chinese workers will have to support both their parents
by themselves on a tiny salary. That's a lot of old Chinese people
who are going to be more screwed than the space program.

#2-
The guys aren't getting any

The Myth:

"China
has their population under control. That one child stuff is pretty
rough, but it works, right?"

The Reality:

Remember
that one child per family policy I mentioned? When some Chinese
families heard that news, their first thought was "Oh sh*t, we'd
better get a boy." Boys can carry on the family name and care
for their parents more than girls, who are supposed to raise the
children. Sexist, yes, but that's how they think over there. The
result is that China has an awful gender imbalance and has some 32
million more boys than girls. Although the practice is illegal
over there, some Chinese families use ultrasounds to determine their
baby's gender and selectively abort until they get a boy. Thus the
current gender imbalance. And of course, Chinese women are only
getting pickier about marriage- they're focusing on their careers
because they have parents to support.

OK, so the guys might
have to go without getting some action. What's the big deal? Fewer
ladies who are less inclined to get married means that they won't
have as many kids. Fewer kids means that the Glorious People's
Republic will have fewer workers in the future. And then where
will the world get its supply of acidic flip-flops?

#3-
They don't actually control the US through debt.

The
Myth:

"Oh my God, the Chinese own us! If they stop buying
our bonds, then we're f*cked and the government will explode because
they own all our debt! Their leader dude is going to start dictating
our laws and he's going to KILL US ALL!!! Run for the bunker!"

The
Reality:

According to the US Treasury website, the total debt
of the United States is not owed entirely to China. In fact, they
only own about 7.8%
of all our debt. Who owns the rest? Most of it is owed to...
ourselves, aka the Federal
Reserve. No, I have no idea how the government is allowed to lend
money to itself. Foreign ownership includes a lot of countries
you wouldn't necessarily expect, like Japan, the United Kingdom,
Brazil, and Lichtenstein. You probably can't even find Lichtenstein
on a map.

For reference, this is it.

But what if China starts selling off the debt they
own? We're screwed, right? Not exactly. China's economy strongly
relies on exports ($155
billion a month). Chinese goods are popular because they're cheap
to make. The exact reasons why they can crank out DVD players and recycled condoms so cheaply get technical, but are due largely to
their currency's low value. Because of economic differences between
their money (the renminbi) and our money (the dollar), anything the
Chinese sell in America automatically makes a nice profit. How do
they keep their money (and export cost) so low? By buying sh*tloads
of US Treasury bonds, aka our
debt. If they want to keep making all that money exporting sh*t,
they have to keep their currency low. If they want to keep their
currency low, they have to buy our debt. The Chinese don't get a
choice.

#4- They won't reach Godzilla-height

The
Myth:

"China has been growing for years! Soon enough
their economy will surpass America's and they'll be the new
superpower! Then they'll challenge us to a war and then we'll fire
nukes and we're doooooooooooomed!!!"

The Reality:

China's
growth rate over the years has been pretty impressive, but the
problem is that it's too big to continue. Seriously, even their
leader, Premier Wen Jiabo, said that China's growth was "unstable,
unbalanced, uncoordinated and unsustainable." The Chinese
are pretty worried about it too, as their insane growth may have
caused their own housing bubble, complete with 800%
real estate price inflation and everything.

$95,000. Hey, it's in a good school district.

The problem is
that China has grown by 8% every year. That's pretty awesome for a
whole country, except for the fact that it's not entirely legit.
Turns out that a lot of that growth was based off the Chinese
government investing in itself. It basically started public works
projects (roads, bridges, ports, etc) to boost national growth. You
invest in a road because it will hopefully pay itself back in
economic growth (people travel faster, cut prices, make more money,
pay more taxes). However, some Chinese economists estimate that these
little projects China is so fond of haven't helped the economy at
all, but have left them with up to 50%
losses. Thy built all this cool *** like airports and roads but
they actually have too
much stuff for anyone to use.

Their growth is reliant on
investment in public works. The Chinese government invested too much
(seriously, 50%
of their GDP). Not enough people use the stuff. If the stuff (bridges
and sh*t) doesn't get used, economic growth doesn't happen. Thus,
China invests in nothing. And of course it's predicted to seriously
bite
them in the ass.

#5- Chinese people drink water
too

The Myth:

"Man, Chinese people are
organized. I wish America had their logistical skills. China's
perfect."

The Reality:

One of the rather serious downsides
of having a massive population and 40% of your people in dry northern
China is that there's a pretty
huge demand for water. Unfortunately, China can't get enough
water fast enough to their people for stuff like household use and
agriculture. They're trying, though... and by that I mean they're
damming up so many rivers that countries downstream of them aren't
getting enough and the environmentalists are getting seriously
pissed. Without water, what happens to all the people that need
it? Do you cut off household use? Stop farming? Tell the dolphins to
swim through air? They better figure out the answer quickly, because
the World Bank says it'll f*ck
over millions of Chinese if they don't do something soon.

China isn't real big on actually
sharing their information, but from what we can gather, their banks
have been kinda f*cking
with us. Chinese banks lend out money, just like every other
bank. However, they might have accidentally lent out too much. If a
person can't pay back a bank loan, the loan is considered
"non-performing"
because the bank doesn't get anything back. Loans, like strippers,
are considered useless if they don't put out. China's banks lent out
so much in the last couple years that although they admit to having a
low rate (5%)
of loans that don't get paid back, outsiders estimate that the real
number is somewhere around 30%.

"Screw you guys over? Never."

So
some Chinese people can't pay back their loans. What's the worst that
could happen? Nothing, as long as thirty percent of the country is
fine with losing their money, which they so diligently store
in the central banks. But hey, it's just their life savings.